MONTPELIER — The City Council will determine at a June hearing whether to acquire the Carr Lot by eminent domain and, if so, how much the city is willing to pay owner Allan Carr.

The council set the hearing for June 5 during its meeting Wednesday night. The parking lot is planned to be used as part of the city’s proposed transportation hub as well as a continuation of the bike path.

Mayor John Hollar said the project has been in the works for at least 15 years and is coming close to a deadline to use $7 million in federal money that has been granted to the city. The city also voted in 2002 to borrow $800,000 for the project.

Hollar said the deadline for the federal money is the reason for the move to eminent domain, since negotiations for the city to purchase the parking lot have stalled. Hollar said the amount the city last offered is confidential until the June hearing, but he did say the city has offered Carr “well over” the appraised value of $800,000.

“This is a significant project that the city has had in place for a very long time. It wouldn’t be the first option for any of us to go the route of eminent domain, but given the values that are at stake here and the opportunities for the city we felt like this was a last resort that we needed to take,” Hollar said, adding Carr is in Florida and has been notified of the city’s plan by email.

Hollar said if the city does acquire the lot after the June hearing, it would take possession immediately and make Carr a final offer of compensation. If Carr declined the offer, the issue would head to court to determine the amount to be paid him, Hollar said.

If the city does take the lot, Hollar said, construction would not begin until after the legislative session next year since the state currently leases the parking lot from Carr.

At the hearing, Hollar said, Carr will have an opportunity to comment on the process, and the city is required by state law to make a determination of necessity to acquire the property.